Solar Panel Loans & Finance

Many homeowners use solar loans and finance options to fund installing solar panels. However with solar prices falling 70% in recent years, more homeowners are able to afford the upfront costs of solar panels.

Solar panels reduce your electricity bills by around 50% and you will receive payments for 20 years from the government's Feed-in Tariff scheme.

To begin comparing prices in your area simply enter your postcode in the form at the top of this page.

Can I get an interest free solar loan?

There are currently no interest free loans, specifically for residential solar panel installation, in the UK. However, there are many reduced interest options available for people wanting to invest in green energy solutions.

Previously, there was one interest free solar loan provider, Engensa, but they could not keep up with growing demands. The solar energy industry in the UK is rapidly growing and changing so new schemes may be introduced in the future.

If you are looking at installing solar panels on your small business residence you may be able to apply for an interest free loan through The Carbon trust. Your business must be in Wales or Northern Ireland. If you have a small business in England they offer other, low interest finance options.

Where can I get a solar loan?

There are companies who specifically deal in financing options for homeowners and small business owners, looking to invest in renewable energy. One of the top companies in the UK offering low interest solar panel installation loans is NES Natural Energy Sources.

NES is not a ‘free solar panel scheme’. Instead they offer to finance the initial upfront costs of installing solar panels and allow you to pay them back at a fixed rate of 7.9% APR over 1 to 10 years.

Funding solar panels yourself will always generate the best return on investment. However, if you cannot finance the initial costs yourself, using an NES loan to install your solar panels could still see a strong, long term return on investment.

You can also get a loan from your bank to cover solar panel installation costs. Most banks offer personal loans specifically for home improvements, which could be used for renewable energy developments.

Banks are becoming increasingly aware of the secure financial returns that solar panels can offer through the Feed-in Tariff (FiT). Therefore, be sure to mention that you are intending to install solar panels with your loan as you may be more likely to receive the finance, and may even be offered a reduced rate.

Other solar finance options

If you do not wish to enter into a solar or bank loan to fund solar panel installation, there are some other options to consider:

Pension paymentsRecent changes to the pension system allow people to take out a tax-free lump sum when they reach retirement age. Many retirees are using this lump sum to invest in solar panels. This is partly due to the returns offered through the Feed-in Tariff over 20 years, which could provide a decent subsidy to the average pension.

Another reason pensioners, in particular, are looking into solar panel installation is the monthly energy bill savings. A huge portion of pension payments are currently used on energy bills, and prices are only set to rise. Solar panels could help to reduce this expense by up to 50%.

Free schemesMany people who struggle to fund solar panels have been drawn in by free solar panel schemes. If properly researched, these schemes can be very beneficial to homeowners, however, there are many issues to consider. Companies who offer free solar panels work by funding the installation of the panels and then receiving the FiT payments to cover their costs and eventually make their profit.

Through these schemes you benefit from reduced energy bills and carbon footprint, whilst not having to pay any costs upfront. However, you are missing out on one of the biggest draws of solar panel installation in the UK, the Feed-in Tariff.

Lending from family and friendsBorrowing money from family and friends could be one of the best ways to secure solar panel finance if you cannot afford to fund them yourself. You can show them the projected timeline for return on investment and decide on a fair repayment plan and interest rate.

Whenever you borrow from family and friends it is imperative to set up a legally binding contract and honour it. You should also make provisions in case you are unable to make repayments due to illness or redundancy.

Should I go for solar panels?

Solar panels can prove worthwhile as a long term investment, both financially and environmentally. Energy prices look set to continue rising for the foreseeable future, therefore the savings made on reduced energy bills will keep expanding. Whilst FiT rates have gone down in recent years, so have the prices of solar panel installation. FiT payments still offer a solid return on investment, enough to subsidise any pension or traditional savings method.

If you are unsure whether solar panels are a worthwhile investment for your household you can use our new solar calculator to find out the total savings and earnings you could make from installing a solar PV system. If you are ready to start looking for solar panels you can use the form at the top of the page to find quality, MCS accredited installers in your local area.

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*Earnings from solar panels depend on various factors (e.g. the location of the property, the position and slope of the roof, the power system of the solar panels), and therefore they vary. £8,080 would be the total earnings over 25 years, including £4,940 from the government tariff. A figure of £8,080 was obtained using the Energy Saving Trust’s Solar Energy Calculator, and is based on the following criteria; north London postal code, EPC Band D or better, 40̊ roof slope, none or very little shade, south-facing roof, and 4kw power system. After purchase and installation costs of £6,700, the profit would be £1,380. The new Feed-in Tariff is active as of January 15th 2016, and is updated quarterly.

All price information based on feedback from our commercial partners. Energy savings taken from the Solar Trade Association.